I don’t know why I am even bothering to post this since the bill will only pass in pieces. The issues of charitable donations and mortgage interest deductions are moot; the House won’t pass those provisions. I’ll talk about it anyway because they are those tax bugaboos that won’t go away as the tax collectors drool over a possible new source of “revenue” for their “investments” that half of us don’t want. Obama wants to raise taxes by $450 billion to pay for his jobs plan.
The same pockets Obama wanted to pick to pay for healthcare, which are the same pockets the “Super Committee” wants to pick are suggested pickings to pay for the 2nd Stimulus aka American Jobs Act. Most of the suggestions have been rejected in the past because of the devastating impact they might have.
Unfortunately, since the biggest pockets, Medicare, Medicaid and Social Security are off the table, the government budget slashers have to go back to the same limited pile of money in discretionary funds and defense.
The camel’s nose is under the tent and after they are done with the “rich,” they will come for you. In addition to reducing the mortgage interest deduction for the “rich,” the deduction for charitable donations will be curtailed if Obama’s recommendations are followed. The new changes to the tax system will limit the percentage of income wealthy donors could write off, including tax breaks for charitable gifts.
This will have charities locked and loaded because it will mean layoffs and cutbacks for the neediest at a time when 1 out of 6 Americans is considered poor.
President Obama believes, as with everything, that the government should decide who and what charities get donations. He thinks the government can do it better. He doubled our donations to foreign charities upon assuming office, and some of the money went to our enemies, such as Hezbollah in Gaza, assumedly for the injured and suffering in Gaza. They are the same people now lobbing missiles into Southern Israel.
The tax system is in dire need of reform and most agree that the loopholes are a problem, but the loopholes that Buffet takes are more the problem than the average small businessman. In New York, where the cost of living is high, two married teachers make 200,000, so Obama is starting to close in on the New York middle class here. There isn’t enough money to pay for all of Obama’s initiatives, the same pockets are being counted over-and-over, and the income ceiling will come down, it has to.
A reform to the tax code would make sense if it were a fair or flat tax as opposed to more progressivism. The super rich will hide their money exactly as they did under FDR’s tax system.
Mr. Obama, who today released the details of the plan he outlined to Congress last week, suggested limiting write-offs for itemized deductions to 28 percent of a donor’s income. The nation’s most affluent people are currently allowed to write off 35 cents of every $1 they spend on charitable giving, housing, medical expenses, and other deductible items.
In effect, Mr. Obama’s plan means that a donation of $100,000 would save a donor $28,000 in taxes, $7,000 less than he or she would save today. The plan, which would take effect in 2013, would apply to married couples with an adjusted gross income of at least $250,000 ($200,000 for individuals) and would provide roughly $400-billion for the federal government over 10 years, the White House said. It would not affect the deduction taken by people who earn less. Read here: Philanthropy.com
Boehner warned against using “permanent tax increases … to pay for temporary spending,”